Decades ago, most regions outside Jawa and those in Eastern Indonesia stood as a stark symbol of less-developed parts of Indonesia. At the time, outside Jawa faced greater infrastructure deficiencies than Jawa. The disparities between regions were glaring,with income, wealth,and opportunities concentrated in Jawa. Any measures of interregional inequality confirmed the observation.

Today, many of the same regions outside of Jawa and eastern Indonesia remain less developed compared to Jawa-Bali. Despite the significant strides made in overarching economic growth and national achievements, and certain areas have exhibited signs of increased prosperity, many regions continue to struggle economically. Some are still entrenched in poverty and others in stagnation as the promises of progress have failed to materialize.

In his latest book entitled Monetary whispers across space, Professor Iwan Jaya Azis (Cornell University) explores how  macroeconomic policy, specifically monetary policy, interacts with interregional inequality. Using the case of monetary policy in Indonesia, a country with high interregional inequality, he examines how national-level policies can inadvertently deepen disparities between regions, and in turn contribute to the limited effectiveness of the policies. Undermining the local conditions, institutions, and spatial dynamics that could strengthen the centripetal forces plays a key role in such a negative feedback loop.

Although monetary policy is designed to be neutral, Professor Azis argues that it can have uneven regional impacts. By amplifying the divide between already developed areas and those still catching up, such policies may undermine their own effectiveness. This self-reinforcing cycle is significantly shaped by the behavior of local banks’ liquidity preferences, risk perceptions, and lending strategies, which can either connect or disconnect national policy goals from inclusive regional development.

Drawing on macroregional data, quantitative models, field surveys, and interviews with local officials and bankers, the book offers compelling insights into one of the central challenges of economic policymaking in a diverse and decentralized nation. It also presents a powerful critique of the “spatial blindness” often embedded in economic governance.

Download the book (open access): click here

Tuesday, 21 July 2026 (online in English)
09.00 – 11.30 WIB (GMT+7)
Zoom webinar, register: click here

Program

09.00-09.40 WIB Opening

09.40-10.40 WIB:  Presentation of the book by author Professor Iwan Jaya Azis

Discussion by

• Tedy Alamsyah (Perhimpunan Bank Perekonomian Rakyat Indonesia/PERBARINDO)
• Professor Bernadette Robiani (Universitas Sriwijaya)
• Dr Sudarno Sumarto (The SMERU Research Institute)
• Dr Luky Eko Wuryanto (Asian Infrastructure Investment Bank/AIIB)
• Professor Budy Resosudarmo (Indonesia Project, The Australian National University)

10.40-11.25 WIB  Q&A

11.25-11.30 WIB Closing